I love to report good news whenever I find it. This is from Bloomberg News and it came out yesterday morning. I still have a number of clients that are waiting for the market to bottom before they buy here. Please take note of my other blogs.
“Prices for U.S. homes may climb as soon as the third quarter, ending declines as foreclosures decline make more home available for sale,” Housing and Urban Development Secretary, Shaun Donovan, said. “Itâ€™s very unlikely that we will see a significant further decline,” Donovan said yesterday on CNN. “The real question is, when will we start to see sustainable increases? Some think it will be as early as the end of this summer, or this fall.”
“Home sales have increased in six out of the past nine months and the number of property owners in default is declining,” Donovan said on CNNâ€™s “State of the Union” program. “Housing prices will begin rising as the number of foreclosures declines,” he said. “In the long run, itâ€™s a good time to buy. Itâ€™s so affordable today compared to where itâ€™s been for generations.”
“Contracts to buy previously owned U.S. homes rose 8.2 percent in May, following a revised 11 percent drop in the previous month,” the National Association of Realtors said on June 29. A separate report by the Chicago-based group on June 21 showed sales of existing houses, which make up about 96 percent of the market, declined in May to a six-month low.
Home prices fell 4 percent in April from a year earlier, the biggest drop in 17 months for the S&P/Case-Shiller index of values in 20 cities. “An estimated 1.7 million U.S. homes were in the foreclosure process and expected to be put on the market as of April, down 18 percent from the peak, as fewer loans entered delinquency and more distressed homes were sold,” CoreLogic Inc. said in a report on June 22.
“The so-called shadow inventory represented a five-month supply at the current sales pace,” the Santa Ana, California-based real-estate information company reported. “The inventoryâ€™s size is a barometer of housing-market health because foreclosed homes sell for lower prices and falling values discourage buying,” said Sam Khater, CoreLogicâ€™s chief economist.
Donovan said lenders are adding requirements “that donâ€™t make sense” for risky borrowers after the government, through the Federal Housing Administration, and raised the minimum down payments for a house purchase. “We canâ€™t over correct,” Donovan said. “We canâ€™t go so far in the other direction that we cut off home ownership for people who really can be successful homeowners.”
“Encouraging home ownership should avoid giving buyers an expectation of making $1 million overnight,” Donovan said. “We can get back to the place where itâ€™s a good investment and we will be able to make money over time.”
Please contact me with any questions or concerns. I’m here to help.
Rustin Singleton, R(S)